Former Qwest chief executive Joe Nacchio would receive a lighter prison term based on one methodology sought by the federal judge handling his re-sentencing.

Serving six years for criminal insider trading, Nacchio was granted a new sentence last summer after a federal appeals court panel ruled that the trial judge miscalculated how much of his gains were a result of the nonpublic information on which his illegal stock sales were based. The gain amount is a key sentencing factor.

As part of the re-sentencing, U.S. District Judge Marcia Krieger on Tuesday asked a government expert to compare Qwest's share performance with two indexes of telecommunications stocks, Nacchio attorney Sean Berkowitz said today in court.

Krieger sought a comparison from May 29, 2001 — the date of the last stock sale on which Nacchio was convicted — to July 31, 2002. Nacchio resigned under pressure from the Qwest board in June 2002.

Nacchio's expert witness, business law professor Daniel Fischel, performed the requested analysis and found that Qwest stock underperformed the two indexes — the Nasdaq and the Amex — by an average of 27 percent during that time frame.

Twenty-seven percent of $52 million — the gross on Nacchio's insider sales — is $14 million, Fischel testified in response to a question from Berkowitz.

All other sentencing factors remaining the same, a $14 million gain would call for a prison term ranging from four years and nine months to five years and 11 months under federal guidelines.

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Factoring in taxes paid and costs associated with exercising stock options, the gain would be about $8 million, leading to a range of four years and three months to five years and three months.

The guidelines are advisory, so Krieger can impose a sentence outside the range, though she would have to state reasons for doing so.

As part of the initial sentence, the trial judge pegged Nacchio's gains at $28 million - the net on the insider sales after taxes and fees.

Fischel, who contends the gain is $1.8 million, testified today that there are limitations to Krieger's methodology.

"It is not linked to the inside information that was the basis for his criminal conviction," Fischel said.

That information relates to Qwest's heavy reliance in 2000 and 2001 on one-time revenue, including questionable fiber-optic swaps with industry peers.

Other events may have contributed to the plunge in Qwest's stock price during the time frame Krieger is reviewing, such as merger rumors and the departure of a top Qwest executive, Fischel said.

Berkowitz contends Nacchio's prison term should be less than three years and five months. The government has argued that guidelines allow for a prison term of up to 12 years and seven months.

Nacchio, who was also ordered to pay $19 million in fines and $52 million in forfeitures, reported to prison in April 2009.

Krieger is slated to issue the new sentence — which will include a lower forfeiture amount — on Thursday.

WATCH Nacchio at 1/5/01 all-hands meeting. "The challenge for us is how quick we come out of the box in 2001 in the face of what looks like somewhat of a slowing economy. ... The first quarter for us and the second quarter for us, absolutely critical. ... You've got to meet your objectives really early this year." Run time: 1:28.

WATCH Nacchio at 1/5/01 all-hands meeting. "After we fix service, the most important thing we do is meet our numbers ... we stop everything else when we don't make the numbers." Run time: 1:14

WATCH Group leader presentations at leadership conference. Nacchio speaks at beginning, end. Run time: 1:04:16 "We are not the same company today that we were two weeks ago ... We have to bury the dead ... This is not your father's Oldsmobile," at 59:50.

WATCH Nacchio at 1/5/01 All Hands Meeting. "The next four weeks are very important. You hit your early numbers ..." at 4:55. Run time 15:24